An Introduction to Elder Law and Long-Term Planning
Americans are growing older and living longer. As the “baby boomers” approach retirement, our entire society, especially the legal system, will be confronted with new challenges. In the 1950s, approximately one out of ten Americans was over 65. By 2030, approximately one out of five Americans will be over 65, and there will be more than 6 million people over the age of 85. This demographic shift is well under way in Pennsylvania, where, according to the 2010 Census, more than 15.4% of our state population is over 65. Consequently, our legal system is adapting to meet the challenges of an aging society. While living older gives us the chance to enjoy more of life, see more of our families, and gain more experiences, it also presents some serious challenges. Obviously, a person’s health generally declines with age. Unfortunately, declining health often requires a person to spend most or all of their savings, leaving little leftover for future generations. Even if a person does not have to expend their savings, inflation likely will have outpaced the growth of social security benefits, pension payouts, and any investments that have been made. In this section, the law firm of Behrend and Ernsberger, P.C. will provide you with information on several important topics within the scope of Elder Law, including:
- Wills and Trusts
- Estate Administration
- Power of Attorney
- Living Wills
- Social Security
- Other late-in-life planning issues
The National Elder Law Foundation defines Elder Law as “the legal practice of counseling and representing older persons…about the legal aspects of health and long-term care planning, public benefits, surrogate decision-making, older persons’ legal capacity, the conservation, disposition, and administration of older person’s estates… giving due consideration to the applicable tax consequences.” Behrend and Ernsberger, P.C. has the ability to assist you in all facets of Elder Law- call us today at (412) 391-2515.
Wills and Trusts
Your will is an incredibly important document that allows you to specify how you want your property to be distributed after your death. If your will is not clearly written or correctly executed, your gifts (called bequests) may not be made to the people that you want. If you are mistaken about the ownership status of some of your property or if you describe it incorrectly, fights can start in your family and raise tension among your friends. With all that is at stake in the execution of your will, it is not something that you should try to do by yourself or at a bargain price. Formulaic wills that you find on the internet may not carry out your wishes in the manner you expect. Further, they do not give you any advice as to the possibility of a bequest failing due to a mistake.
An improperly executed or incomplete will is a nightmare for a family that is already in grief for having lost a loved one. Even in the age of the internet, you need an attorney to draft your will for you. The legal team at Behrend and Ernsberger, P.C. has the skill and experience necessary to avoid the traps of an improperly executed will or incorrect bequest. Our lawyers will review the ownership status of the property that you are attempting to bequeath. They will include a residuary beneficiary and provide back-up plans should a beneficiary under your will pre-decease you.
If you already have a will, it is important to check it occasionally. If you want to make a small change, it is still extremely important that you contact an attorney. While codicils are valid if executed properly, there are many rules that must be met for the change to be effective. First, it must appear above your signature. Second, it must specifically replace an existing term, or address a piece of property not addressed in your original will. Third, you must sign or initial it.
If you have a will that you want to void, you must take physical action. Burning or shredding the original is the best way to void a will. If you want someone else to do destroy it, it must be done in your presence. It is extremely important that a duplicate original of your will be kept somewhere other than your house in case your will is accidentally destroyed in a fire, flood, or some other calamity. Law firms have safe and secure filing systems for wills that can help protect you in the event that something happens to your will.
Save yourself the headache. Call the legal team at Behrend and Ernsberger, P.C. at (412) 391-2515.
Trusts are legal devices that allow for a person to assign a trustee to manage property for the benefit of another or of his or herself. By transferring property, like an annuity, into a trust, a person (the settlor) may assign the trustee to handle payment of certain bills or to invest the proceeds in a safe fashion for use at a later date. Trusts may also be used to provide for care of loved ones after your death. For instance, a person may establish a trust that provides for monthly payments to his or her children. Or a person may establish a trust that makes periodic donations to charitable organizations or churches. Trusts may also be established to protect assets. The assignment of a trustee ensures that the wishes of the settlor are carried out.
If you are interested in establishing a trust, call the legal team at Behrend and Ernsberger, P.C. at (412) 391-2515.
Even if your will is properly executed and all of gifts are correctly described, your will still must be probated. You can aid the process by designating an executor in your will. Naming a back-up executor may be a good idea as well. For an added fee your attorney can serve as the executor as well. Naming an executor who has the ability to address the complex legal issues that inevitably arise after a death is very important. The executor first finds and tallies your assets. The executor then begins the probate process. At probate, the court will determine if your will is valid, inventory your property, assign the executor to pay off all of your debts and taxes, and then distribute the property in accordance with your will.
During the probate of an estate, the executor is faced with many challenges. First, the executor must determine what, if any, the amount of estate tax will be. A well-drafted will can minimize the impact of the estate tax (the estate tax returned in 2011, after the 2001 tax cuts expired). One major change in the taxation of estates in 2011 is the return of the stepped-up basis rule, which means that a person who inherits property receives a basis equal to the fair market value on the date of the previous owner’s death. In addition to the confusing federal tax rules, Pennsylvania has its own tax rules that must be followed. Second, the executor may have to address a challenge of the will or a specific gift under the will. If someone challenges a gift under your will, the executor will have to fight back. If these are both family members, it is plain to see how family strife may occur. A no-contest clause may be appropriate in your will. You will need an attorney to draft an effective, and constitutional, no-contest clause. Third, if your estate is not solvent (meaning that there is not enough value to cover your debts and all of the bequests), the executor will have to follow specific rules, meaning that some people will not get what you wanted them to get. Fourth, the executor may have to prove your will. This means that the executor may have to prove, among other things, your competency at the time the will was drafted. Witnesses are not required in Pennsylvania, but drafting your will with an attorney can help ensure that your will is a valid document based on competency. Finally, the attorney will have to determine what property is not covered by your will and is therefore non-probate property. Jointly owned property, such as property owned in a Tenancy by the Entirety, Tenancy in Common, or Joint Tenancy with a Right of Survivorship, is non-probate property. Life insurance is also non-probate property.
With all of the perils of will drafting and the probate process, it is essential that you have an experienced and skillful attorney. Call the attorneys at Behrend and Ernsberger, P.C. today at (412) 391-2515 to help guide your estate through the probate process as smoothly as possible.
A guardianship is a legal arrangement in which a person, called the ward, is declared incompetent or incapacitated by a court and another person, called the guardian, is appointed to become a decision maker for the ward. Guardianships are available in contexts other than elder law, but it is an increasingly common arrangement to care for senior citizens stricken with Alzheimer’s disease, dementia, or other progressive neurological conditions. Until diseases like Alzheimer’s are cured, the guardianship will remain an important tool to protect the victims of neurological disorders.
Guardians are appointed by the Orphan’s Court in Pennsylvania. The process begins with the filing of a petition for guardianship, which may be filed by a person seeking to be named the guardian or by another concerned party. After the petition is filed, Pennsylvania law requires a hearing in front of a judge, who determines if the ward actually needs a guardian and if the proposed guardian is capable of handling the ward’s affairs. The hearing is “non-adversarial,” meaning that the judge and everyone else at the hearing has the best interests of the ward in mind. If the proposed guardian is capable and no one else has been proposed, the hearing will normally go smoothly. The guardian may be a family member, a non-profit guardianship agency, or a corporate fiduciary. A guardianship may be plenary or limited. A plenary guardianship gives the guardian control over the ward’s general care and financial dealings. In addition, a plenary guardian may give legal consent to execute documents on behalf of the ward and may even decide where the ward should live. A limited guardian only has powers that are defined by the Orphan’s Court, and the guardian may not exceed those powers.
Once the guardian is appointed by the court, the guardian owes the highest of fiduciary duties to the ward. Unfortunately, there have been cases where a guardian embezzles funds from the ward or simply neglects to take care of the ward. Because of these cases, Pennsylvania has been gradually increasing the amount of court supervision over the guardian.
If you are seeking to be appointed a legal guardian or if you are seeking to block the appointment of someone else as guardian, you will need the advice and counsel of an experienced attorney. The legal team at Behrend and Ernsberger, P.C. can provide the sound advice that you need in the stressful and complex process of guardianship appointments. Call us today at (412) 391-2515 if you need assistance in addressing the guardianship of a loved one.
Power of Attorney
The Power of Attorney (POA) is a legal power that is granted by a person called the principal allowing another person, called the agent, to make decisions for the principal. Like a guardianship, the POA allows someone to make difficult decisions for an aging person in declining health. However, unlike a guardianship, the POA is entered into before the aging person is in full decline. The POA allows an aging person to select his or her caretaker.
There are several variations of the POA. In elder law, the important variations are the healthcare POA, the durable POA, and the springing POA. The healthcare POA allows the principal to name an agent who will make medical decisions for the principal if the principal is unconscious, incompetent, or otherwise unable to act for himself. The durable POA allows the principal to name an agent who will act in the business aspects of the principal’s life, such as managing bank accounts, paying bills and filing taxes. The same person may serve as an agent under a healthcare POA and a durable POA. A springing POA addresses the same subject matter as a durable POA, but it does not come into force until an event like the incapacity of the principal happens. Other variations of the POA are called general and special. A POA may be general, meaning that the agent has the power to oversee the principal’s financial and daily affairs. A special POA allows the agent only to do the specific task assigned by the principal.
Creating a POA requires a written contract between the agent and the principal. You may have seen “fill-in-the-blank” forms on the internet. Do not use these! The POA is an incredibly powerful tool and you need to consult with an attorney before signing away your rights to someone. An attorney can tell you what powers you need to grant and if the person you have selected in an appropriate agent. Moreover, an attorney will make sure that you are not pressured into giving away a power that you are not comfortable giving away.
The legal team at Behrend and Ernsberger, P.C. has the experience necessary to ensure that a Power of Attorney addresses your needs and if a POA is the best course of action in planning for your future care. Call us today at (412) 391-2515.
Advancements in medical technology have created several new options for extending the life of the terminally ill or of those in a persistent vegetative state. These technological advancements have created new medical, ethical, and legal questions. Your beliefs on the use of resuscitative technology, life support systems, or even blood transfusions could be very strong. On the other hand, if you have never considered what you wish to happen should something happen to you, now may be the time to begin making these very difficult decisions.
To address the advancements in life-sustaining technology, the law has developed the living will. Before living wills, doctors could either turn to a spouse or children of a patient to make the decision as to whether or not to continue life support, or they would refuse to allow any decision at all and continue life support indefinitely. To avoid these types of situations, the living will was created to allow an individual to express his or her wishes on the subject in a legally binding manner.
To demonstrate the effectiveness of the living will, a study published in the New England Journal of Medicine found that 42.5% of the study’s subjects required some form of medical decision making. 70.3% of those requiring medical decision making lacked capacity to decide, but 67.6 of those lacking capacity had a living will. Of those with living wills, 97.1% of those who requested only comfort care, essentially hospice care, saw their wishes carried out. Those who requested aggressive treatment in their living wills were far more likely to receive the aggressive treatment, but only about 50% of those requesting all care possible received treatment that included every option.
For a living will to become operative, it must be delivered to the attending physician, who must make two important declarations. First, the doctor must declare the patient to be incompetent to make decisions. Second, the doctor must declare that the patient is in the end-stage of a medical condition or that the patient is permanently unconscious. The declaration of incompetency is a legally and medically significant event, and it is good to have an attorney on your side if that declaration ever needs to be made.
There are some formal requirements to create a valid living, as well as a host of difficult decisions to make. At attorney can explain the consequences of the various decisions that you may have to make and ensure that the drafting requirements are met. Do not fill out a living will online! You need to make sure that you understand the legal significance of each decision that you are making. The legal team at Behrend and Ernsberger, P.C. has the skill and experience to assist and guide you through this difficult process- call us today at (412) 391-2515.
Social Security plays a vital role in the lives of millions of Americans, including over 1.5 million Pennsylvanians. In addition to the most well-known program, Old Age (retirement) insurance, Social Security includes Social Security Disability Insurance (SSDI), Supplemental Security Income (SSI), and many other programs. For the purpose of later-in-life planning, it is extremely important that you are familiar with the retirement income programs and with SSI.
Social Security is funded through a tax that is levied on employers and employees. There is a popular misconception that the money withheld from your paycheck is being held for you. That is not the case. Rather, the money that you pay in goes to support the beneficiaries that are currently receiving payments. Of course, today’s retirees supported the generation before them when they used to work. This is known as a “pay-as-you-go” system of revenue. It was designed to build a reserve account over time. Due to a variety of factors, including the demographic shift towards an older population, the reserve account will soon be drawn down. As the reserve account shrinks over the next several decades, social security will continue to be a hot-button political topic. Regardless of your political views on the subject, it is important to know how the system currently works.
Social Security retirement benefits are based on your work history, income levels, and retirement age. The benefits are monthly payments made directly to the recipient. The Social Security Administration keeps your records to determine your benefits level; an attorney may review your file to double check the Administration’s determination. Depending on the year you were born, Congress has set a “full” retirement age. For those born between 1943 and 1955, for instance, “full” retirement is attained at age 66. Once a person is 62, he or she may elect to begin receiving benefits, but there is a reduction in benefits for every month before “full” retirement age. On the other hand, waiting to take your benefits past the age of “full” retirement entitles a person to an increase in benefits. Once a person turns 70, however, there is no more growth in benefits. Therefore, timing your social security retirement benefits is a very important aspect of your later-in-life planning. An attorney can help you decide if electing early benefits would be worth the loss in monthly benefits, or if waiting past “full” retirement would be a worthwhile risk. Finally, it is important to remember that social security income is subject to a variety of tax laws.
Spouses of qualified workers are entitled to receive an amount equal to half of the worker’s benefit amount. There are some additional rules that must be met before spousal benefits are permissible. Furthermore, spouses and dependent children are able to receive survivor benefits, which are equal to the worker’s benefit level. If the spouse is eligible to receive his or her own benefits, he or she may elect the higher amount of the his or her own benefits or the spouses, but may not combine them.
SSI is available to those over age 65 who fall below a certain income and resource threshold. The threshold for income varies based on factors such as place of residence, type of living arrangement, and the type of income the person receives. The term resources refers to available cash, stock ownership, real estate property, personal property, and other sources that you may able to liquidate to turn into cash. The threshold for the maximum amount of resources that a person may have to be eligible for SSI varies greatly.
Planning for your later-in-life financial needs should involve social security strategizing. To best understand what your social security options are, you should contact an attorney from Behrend and Ernsberger, P.C. today at (412) 391-2515.
Turning 65 has major legal implications for those who intend to enroll, or are eligible to enroll, in Medicare. Medicare is a federally funded health insurance program. Over 2 million Pennsylvanians are currently enrolled in Medicare, and as the state’s demographics shift towards an older population, that number is expected to grow significantly. The scope of Medicare coverage is extremely broad, and understanding everything that Medicare does (and does not do) can be a nightmare. For instance, Medicare does not cover custodial care, including most nursing home care, most immunization shots, most routine checkups, most dental and foot care, or hearing and vision care, nor will it pay for a telephone in a hospital room.
Almost all citizens are eventually eligible for Medicare regardless of their assets and income. Persons aged 65 and older who are eligible for Social Security or Railroad Retirement benefits are eligible for Medicare. Persons under age 65 but who have been eligible for Social Security or Railroad Retirement benefits for at least 24 months are also eligible for Medicare. There are a few other ways to become eligible for Medicare, such as being diagnosed with a qualified kidney disorder. The Social Security Administration makes the final decisions on eligibility and enrollment.
Medicare is divided into several parts. Understanding Parts A, B, and D is particularly relevant in planning for long-term care. Part A is often called hospital insurance, because it generally addresses hospital care. Part B covers many types of care that Part A does not, such as physician services, ambulances, and outpatient care. Part D is the newest section, and it covers prescription drugs. However, Medicare is far from being comprehensive. Each Part has technicalities that are very difficult to understand. Learning the system and what is covered is important in long-term planning.
Part A covers inpatient hospital care. It pays for all hospital covered services, except for the person’s deductible, for days 1-60. Part A pays for all covered services except for a daily coinsurance payment for days 61-90. If a person uses all 90 days of coverage and then does not require hospital treatment or skill nursing care for the next 60 days, the clock resets and the person gains another 90 day window. For care extending beyond 90 days, persons are given 60 reserve days which they may use at any point in their life. In a few instances, Medicare covers skilled nursing care for certain periods of time.
Part B requires that enrolled persons pay a monthly premium, an annual deductible, and co-insurance of 20 percent on most services. Enrollment in Part B is optional, and all who are eligible for Part A are eligible for Part B. Part B covers things like outpatient hospital care, ambulances, diagnostic tests like X-Rays, physical therapy, and diabetes glucose monitoring. There is a late-enrollment penalty assessed to those who enroll in a later year than the year they became eligible.
Part D is available to all those entitled to Part A coverage or enrolled in Part B. Enrolling in a Part D plan requires several choices to be made. First, a person may choose to enroll in either a Medicare Advantage Plan (MAP) or through an independent prescription drug plan (PDP). In 2007, in Pennsylvania, there were 66 different Part D plans to select from. The amount of coverage available is based on the annual cost of the person’s drugs. For the first $2,840 spent, an insured pays a co-insurance amount. For amounts between $2,840 and $4,550, Part D provides no coverage and the insured pays the full cost (this is known as the donut hole in coverage). For amounts over $4,550, the Part D plan covers almost all of the costs (this level of coverage is known as catastrophic coverage). To address the problem of the donut hole, each year Congress may pass a law to “patch” the hole. In 2011, the donut hole is patched by a 50% reduction in the cost of certain prescriptions. It is important to note that there is a penalty imposed for enrolling in a later year than the year you became eligible.
Various privately offered plans can close the donut hole and address the many other gaps in Medicare coverage. These plans are known as Medigap plans. In Pennsylvania, there are 10 standard Medigap plans available to choose from. Medigap plans often pay for most or all of the insured’s Medicare co-insurance costs and some plans cover Medicare deductibles, while others cover some services not covered by Medicare. Timing the purchase of Medigap insurance can be difficult to understand, as there is an “open enrollment” period immediately after an eligible person turns 65, but it may be to your advantage to delay enrolling in Part B and Medigap plans.
This is only a very basic introduction to the extremely complex Medicare coverage system. For most retirees, Medicare has at least some role in healthcare, and for many, Medicare is their primary insurer. Therefore, sound later-in-life planning requires a detailed analysis of how you will be impacted by Medicare. Because Medicare is such a politically charged topic, it will be in a state of flux for years to come. Therefore, you need attorneys who not only can explain how Medicare works, but how each year’s changes will affect you. The legal team at Behrend and Ernsberger, P.C. has the skill and experience to be your guide in the complex world of Medicare- call us today at (412) 391-2515.
Important Late-in-Life Issues
When planning for late-in-life care, every person should be aware of the importance of documents like wills, trusts, Power of Attorney, and living wills. People should also be aware of the possibility of guardianship arrangements. Finally, it is very important for people to understand Medicare, Social Security and Veteran’s benefits. There are a few other topics that are important to understand. First is the difference between various managed care living arrangements. Nursing homes, assisted living, adult day care, hospice care and in-home care are all living arrangements available to those in declining health. It is important to understand the types of care provided, as the monthly cost varies greatly. For those needing basic assistance, in-home care or independent living facilities may be appropriate. Social care is provided in these arrangements and includes things like cooking and cleaning assistance. As medical needs increase, assisted living facilities become more appropriate. In an assisted living facility, a person is still given privacy and freedom, but skilled care is available. Skilled care includes bathing assistance, medication administration, and physical therapy. A nursing home is the next step after assisted living, and includes significant medical care. Nursing homes can cost significantly more than assisted living. Hospice care is end-of-life care designed to make the person as comfortable as possible while maintaining as much dignity as possible. If possible, home hospice care allows a person to return home to give the person more comfort.
The legal team at Behrend and Ernsberger, P.C. is familiar with local care options and pricing. We can assist you in finding the best fit for your needs at a particular time, and we can examine what types of care may be covered by Medicare. Behrend and Ernsberger, P.C. is committed to providing comprehensive legal advice, and choice of living arrangements is just one of many areas that we can provide sound advice for.
Elder abuse refers to a wide variety of crimes and misdeeds committed against the elderly. The elderly are particularly susceptible to predation for a variety of reasons, but the most common reason is that a predator sees an easy victim. Abuse may be physical, mental, financial, or neglectful. Guardians or those with power of attorney may embezzle funds, caretakers may beat or ignore the needs of their patients, or a person may be forced into signing away rights or funds.
Protecting the elderly is an incredibly important task, but it is very difficult to do. Many elder abuse victims do not report their suffering for a variety of reasons. In some cases, the victim may be unable to contact an authority. In others, the victim may be unaware of the abuse (normally in financial abuse). In yet other cases, the victim may feel that reporting the abuse may cause retribution or abandonment. Even in guardianship arrangements, courts cannot exercise supervisory powers at all times. Therefore, if you believe that a loved one is the victim of elder abuse, you must say something. You may be the only hope.
The law firm of Behrend and Ernsberger, P.C. is committed to protecting the rights of the elderly. We have the skill and experience to take the appropriate steps to prevent future elder abuse. Call us today at (412) 391-2515 if you or a loved one is suffering from elder abuse.